The Ellis Tanner Trading Company settlement resolved a federal class action alleging that the Gallup, New Mexico trading post used deceptive terms on tax-refund advances and holiday loans made to Navajo customers. In July 2018, the corporate entities behind the business agreed to settle, and the plaintiffs’ attorney said the Ellis Tanner case and a parallel case against T&R Tax Service together required the two companies to repay about $1 million to affected borrowers.1Navajo Times. Settlements Reached in Cases Against Ellis Tanner
What the Lawsuit Alleged
The class action was filed in the United States District Court for the District of New Mexico as case number 1:12-cv-01144-JCH-KBM. The named defendants were The Big AE Incorporated and Native American Loan Company, Inc., doing business as Ellis Tanner Trading Company.2GovInfo. USCOURTS-nmd-1_12-cv-01144-2 Karrie Manuelito and Wilton Davis were the named plaintiffs.
Two loan products sat at the center of the case. The trading post extended advance payments against expected tax refunds and offered “holiday loans” around Thanksgiving and Christmas, pegged to refunds borrowers expected to receive after January 1. The plaintiffs contended the terms were misleading and harmed the several thousand Navajo customers who used the store’s tax and lending services.1Navajo Times. Settlements Reached in Cases Against Ellis Tanner
Who Was in the Class
The Ellis Tanner class covered several thousand former clients of the trading post’s tax and lending services. Class members were expected to receive notification letters from the Mattison law firm in the weeks after the July 19, 2018 announcement, describing the settlement terms and their rights under the agreement.1Navajo Times. Settlements Reached in Cases Against Ellis Tanner
Settlement Amount and Approval
Albuquerque attorney Nicholas Mattison, who represented the plaintiffs, told the Navajo Times that the two companies were required to “repay back about a million dollars to settle the suits.” The $1 million figure covers both the Ellis Tanner settlement and the T&R Tax Service settlement together; the specific split between the two was not publicly disclosed.1Navajo Times. Settlements Reached in Cases Against Ellis Tanner
The Ellis Tanner settlement received preliminary approval from a state district court judge. No further public reporting on final approval or the distribution of payments has been identified in the source record.
The Parallel T&R Tax Service Case
The Ellis Tanner suit was closely linked to a separate class action against T&R Tax Service, which ran grocery stores, pawn shops, and tax preparation offices in border towns including Gallup, Farmington, Shiprock, and Chinle. That case was filed in federal district court in Albuquerque on behalf of lead plaintiffs William and Sammia DeJolie and a class of roughly 15,000 clients.3Santa Fe New Mexican. Navajo Nation Area Business Sued Over Tax Refund Anticipation Loans
The DeJolies alleged they were charged a 385 percent annual interest rate on a $1,250 loan taken out in November 2014. The complaint accused T&R Market Inc., Tancorde Finance Inc., and T&R Tax Service Inc. of violating the federal Truth in Lending Act, willful breach of contract, unjust enrichment, and imposing hidden charges while understating interest rates.3Santa Fe New Mexican. Navajo Nation Area Business Sued Over Tax Refund Anticipation Loans Mattison represented the plaintiffs in both cases.
As of the Navajo Times report, the T&R settlement had been submitted to the federal court but was still awaiting the judge’s preliminary approval. Class members would then receive letters detailing the terms.1Navajo Times. Settlements Reached in Cases Against Ellis Tanner
Why These Cases Happened in Gallup
The suits landed in a corner of New Mexico where high-cost lending to Navajo customers has drawn repeated legal scrutiny. A 2014 NBC News investigation reported that Gallup-area lenders issued more than 52,000 loans totaling $27.5 million in 2012, with interest rates of at least 175 percent. A 2017 New Mexico law eliminated payday loans in the state but carved out an exemption for the kind of tax-refund-anticipation loans that companies like T&R and Ellis Tanner offered.3Santa Fe New Mexican. Navajo Nation Area Business Sued Over Tax Refund Anticipation Loans
Ellis Tanner Trading Company operates at 1980 West Highway 602 in Gallup, just outside the Navajo Nation, and has offered pawn-based cash loans and income tax filing services alongside its retail business.4Visit Gallup. Ellis Tanner Trading Co5Archaeology Southwest. LCNHA Feasibility Study – Theme 06 The refund advances and holiday loans tied to those services are what the class action put in front of the court.